Why might an investor choose to use capital assets in their portfolio?

An investor might choose to use capital assets in their portfolio primarily for the reason of long-term, ongoing sources of value. Capital assets, such as real estate, machinery, or intellectual property, often provide a steady stream of income or contribute to the overall growth of a portfolio over an extended period. These assets are typically characterized by their ability to appreciate in value, generate cash flows, and serve as a hedge against inflation.

Investing in capital assets aligns with a long-term investment strategy that aims to build wealth over time rather than seeking quick returns. Such assets can enhance the stability and growth prospects of a portfolio, making them a respectable choice for investors who are looking for sustainable value rather than short-term gains.

In contrast, focusing solely on short-term profits limits the investor's perspective and may involve higher risks associated with market volatility. Avoiding market fluctuations entirely is not practical because all assets may be influenced by market conditions. Lastly, speculative investments typically carry a high level of risk and are not synonymous with the steady value generation that capital assets provide. Therefore, long-term value generation through capital assets is a fundamental investment strategy aimed at wealth accumulation.